Caltex hints of another oil price hike

Caltex Philippines Inc. hinted yesterday of another round of oil price increases, just days after a 30-centavo hike in diesel cost.

Caltex spokesman Jorge Marco said the expected fuel price hikes could be attributed to rising regional product costs.

Marco said the increase is over and above the cost increases related to meeting more stringent fuel specifications under the Clean Air Act.

"The spot market price of unleaded gasoline in the region has gone up by more than one peso per liter in December compared to the previous month’s price, while the spot price of diesel has also risen by about 50 centavos per liter over the same period," Marco said.

Marco noted that on a per barrel basis, in the case of gasoline it had breached the $40 per barrel level in early December after trading at an average of about $36 per barrel in November.

"This is the first time it had reached such a level since March (last year)," Marco said. "It is now trading at over $42 per barrel," he added.

Marco said the increase in petroleum product costs can be attributed to strong seasonal demand in the region.

Caltex, a wholly-owned subsidiary of ChevronTexaco, a leader in the global integrated energy business and active in more than 180 countries, has closed down its Philippine refinery and decided to just import and market finished fuel products for distribution in the country.

Last Saturday, the oil companies, including Caltex, raised the price of their diesel products by 30 centavos per liter to recover the costs from complying with new CAA diesel specifications.

For its part, the Department of Energy said it expects the latest increase in diesel prices as a result of more stringent fuel standards on automotive diesel effective Jan. 4. The Philippines now has one of the most stringent diesel standards in Asia as a result of the CAA. The DOE also urges oil companies to maintain their diesel price discounts for public transport use in selected stations.